Pre Paid Credit Card: a Smart Way to Control Spending
Contributed by Julia Reese
What is a Pre paid Credit Card?
A pre paid credit card is a credit card that is similar to a pre paid phone card in that you fund the card in advance and you can reload it whenever funds are exhausted or if you simply want to add more to the card. It has a number on the face of the card just as a traditional credit card does, giving the appearance of a regular credit card. The application process for a pre paid credit card is not as stringent as the application process for an unsecured credit card.
A credit check is not always required, making your credit rating irrelevant in many cases. Your income is not as significant a factor, nor is your length of time at your place of residence. So these are a couple of advantages for this type of card. Let us examine some more.
What are the Advantages of a Pre paid Credit Card?
One great advantage is that virtually anyone can apply for a pre paid credit card. College students, who usually have no significant income or credit history, are welcomed to apply for this type of card. People with a poor credit record who wish to rebuild their credit also make great candidates for this type of card since credit history is usually not even considered.
Those who are afraid of over spending but want to attain a solid credit report -- in essence, budget spenders, would also make good applicants for this card. There is no interest rate as opposed to the traditional card where interest rates can spike in the 20th percentile. By the time all is said and done, one will have paid more than the cost of the items charged with a traditional credit card, making this a clear advantage.
